‘Lack of Accountability’ in Rivington House Debacle Prompts Policy Changes but No Heads Roll

July 20, 2016

Days after a damning Department of Investigation report found that “a complete lack of accountability” within Mayor Bill de Blasio’s administration allowed a Lower East Side residential nursing home to be converted into luxury condos, elected officials are calling for a new agency to handle the process that allowed the infamous Rivington House deal to happen.

Gale Brewer, Councilwoman Margaret Chin, and City Council Speaker Melissa Mark-Viverito held a press conference this morning to say that they have asked the City Planning Commission to make deed restrictions part of the city’s routine Uniform Land Use Review Procedure (ULURP), the process that has guided shifts in land use for decades.

“We lost Rivington House because the deed restriction change was managed by the wrong agencies in a bad process,” said Brewer. “The best way to fix this is to handle these land use changes the same tried-and-true way we’ve handled other land use changes for years.”

The Department of Citywide Administrative Services handled the deed removal for Rivington House, and the DOI report said there was “a lack of accountability…and significant communication failures between and within City Hall and DCAS” throughout the process.

Village Care, which was operating Rivington House as a nonprofit AIDS hospice, sold the property to Allure, a for-profit healthcare company, for $28 million in February of 2015. Allure subsequently paid the city $16 million to lift two deed restrictions, which required that the building be used for nonprofit healthcare services, and flipped the property for $116 million to luxury condo developers this year.

The new process would require that any request to remove a deed restriction be handled through the Department of City Planning and the City Planning Commission, which would include public hearings involving the community board and borough president. The final decision would be left up to the City Council.

A quirk in the City Charter requires that the Department of Planning recommend this change before the City Council introduces legislation to make it a law.

Following the sale of Rivington House in February, city, state, and federal agencies opened investigations into the legality of the deal. Mayor de Blasio insisted his administration knew nothing about the conversion, but that claim was refuted in last week’s DOI report, which cited emails from First Deputy Mayor Anthony Shorris, Deputy Mayor Alicia Glen, and Shorris’s chief of staff, Dominic Williams, discussing potential plans to convert Rivington House to housing.

City Councilman Rory Lancman has called for the DOI to take legal action to compel City Hall to hand over documents and provide access to computers denied to the DOI during the investigation, despite an executive order that grants them unfettered access.

So far, there has been no mention of punishment for any specific individual over the questionable sale, despite repeated calls for accountability at today’s press conference from Chin and Brewer.

In early July, a scheduled City Council hearing to discuss Rivington House was postponed until the fall. “We plan to still have our hearing in the fall. We’re also still gathering our information. The DOI report was really vital,” said Mark-Viverito.

The Mayor’s office has since announced their own set of reforms to the deed removal process, and offered $16 million in restitution to the community, which is strapped for affordable housing and health facilities. Some say that amount isn’t enough.

“To build a new building [to replace Rivington House] would cost closer to $200 million. We appreciate what the mayor has done in terms of his statement but [it] is not sufficient and does not answer the needs for the neighborhood, which would include a brand new building that would house as many individuals,” said Brewer. “That was a building where people were part of the neighborhood. That was their home. We need another that provides affordable housing just like Rivington House.”

Neighborhood activists, with the support of Councilwoman Chin, say they’re not giving up the fight, and they want to see Mayor de Blasio lead the charge.

“At some point the city saying it was a mistake does nothing for people who were harmed by this and who needed that facility,” said K Webster, a Community Board 3 member and part of Neighbors to Save Rivington House, who noted that the communities most affected by the removal of deed restrictions are home to people of color and the poor. She offered the Lower East Side, Bedford-Stuyvesant, and Harlem, where a lot owned by a dance company and bound by a deed restriction was lost to real estate developers in May, as examples.